Aircraft use tax may discourage seasonal visitors; A tax designed to dissuade residents of Maine from buying aircraft in no-tax states also affects tourists who fly here.

A tax aimed at out-of-state pilots with hefty incomes could discourage some seasonal residents from making frequent visits to Maine.

Under a 2005 revised tax policy that became effective in January, the owner of a new $1 million aircraft could be taxed $50,000 if it was bought in some out-of-state locations and if it spends more than 20 days in Maine during the first year of ownership.

The policy is creating major turbulence nationally among private-aviation advocates, who now perceive Maine's skies as anything but friendly.

The tax was established to discourage Maine residents from purchasing aircraft in states without a sales tax, but the tax also applies to out-of-state aircraft owners who have bought a certain class of airplane within the last 12 months.

The 5 percent tax, or a portion thereof, is applied to those who buy a plane in a state with a sales tax of less than 5 percent or no sales tax and bring the aircraft to Maine for more than 20 days within a year of purchasing it.

The tax, known as a use tax, was amended to exclude larger jets and commercial planes but still applies to smaller private piston-engine planes that weigh less than 6,000 pounds.


To determine which pilots have bought new planes and how much time they are spending in Maine, the state requests flight plans archived by the Federal Aviation Administration.

Officials with the Aircraft Owners and Pilots Association say pilots across the country will feel the effects of the tax.

The Maryland-based national aviation lobbying group has notified Gov. John Baldacci that it wants an immediate elimination of the tax, which it says may violate federal laws protecting interstate air travel.

''(The policy) also flies in the face of your (administration's) emphasis on building a 'fair and stable business environment,''' wrote Phil Boyer, association president. ''Please know that in the meantime, we will be advising AOPA's 410,000 members outside of Maine to forgo what might be a fairly costly trip to your state.''

Joy Leach, a Baldacci spokeswoman, said the governor's office is reviewing the letter with state tax policy experts.

Officials with Maine Revenue Services, the state's bureau of taxation, defended the airplane tax as consistent with Maine's overall tax policy. They noted a similar tax is in place for out-of-state residents who haul new boats into the state for recreational use.


Bill Perry, who operates Maine Instrument Flight and Maine Beechcraft at the Augusta State Airport, said the ''short-sighted money grab'' would have a chilling effect on Maine's tourism industry.

''If you own a plane and a summer home here, or have relatives here and you want to come and visit for month, you're not going do that,'' Perry said. ''The state must want these people not to come here - and they won't, because they're afraid they're going to get nailed on a use tax on their airplane.''

The tax applies to aircraft with a purchase price of at least $270,000. Such a purchase would trigger a Maine tax bill of $13,500 if the plane were bought in Alaska, Delaware, Montana, New Hampshire or Oregon, none of which has sales taxes.

Closer to home, Perry fears the potential loss of routine aircraft maintenance income that his company derives from out-of-state aircraft owners. Maine Instrument Flight has built a reputation for delivering quality service at competitive rates, he said, and it's not unusual for out-of-state aircraft owners schedule their regular aircraft maintenance while vacationing in Maine.

Now, he said, his customers will have to start counting how many days they are spending in the state - one cumbersome chore too many for someone who's trying to relax, Perry said.


At Maine Revenue Services, acting state tax assessor Jerome Gerard said critics of the tax on aircraft are not considering the full benefits of the recently applied exemptions.

He said the law deducts from the 20-day window any time the aircraft is undergoing major alterations, major repairs or preventive maintenance.

Gerard said the tax brings in about $2 million annually to the state. He said the state's 20-day window does not apply if a pilot has owned a plane for more than a year.

''I think (lawmakers in 2005) looked hard to find a balance and looked at the number of days an individual can bring a plane here,'' Gerard said.

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